#earnedvaluemanagement

Preparing for the PMP® exam? Mastering formulas is one of the fastest ways to improve your score and strengthen real-world project decision-making. Here’s a quick, value-packed guide to the 25 formulas every PMP aspirant must know.

📌 Why These Formulas Matter

PMP formulas help you:

Track cost & schedule performance

Forecast project outcomes

Analyze risks accurately

Make data-driven decisions

Solve situational questions faster

Boost confidence for the exam

📘 Top PMP® Formulas (Short List)

1. PV: Planned % × BAC → Planned progress 2. EV: Actual % × BAC → Earned progress 3. AC: Actual cost → Money spent 4. CV: EV – AC → Budget health 5. SV: EV – PV → Schedule health 6. CPI: EV ÷ AC → Cost efficiency 7. SPI: EV ÷ PV → Schedule efficiency 8. EAC: BAC ÷ CPI → Final cost forecast 9. EAC (Revised): AC + (BAC – EV) → Atypical variance 10. ETC: EAC – AC → Remaining cost 11. VAC: BAC – EAC → Final over/under budget 12. TCPI: (BAC – EV) ÷ (BAC – AC) → Required efficiency 13. EMV: Probability × Impact → Risk value 14. PERT: (O + 4M + P) ÷ 6 → Duration estimate 15. Channels: n(n-1)/2 → Communication complexity …and more (25 total).

⭐ Quick Tips to Remember

Positive CV/SV = good.

CPI & SPI ≥ 1 = performing well.

EAC tells you where the project is headed.

EMV helps you choose the best risk response.

PERT is more realistic than simple averages.

🎯 Perfect for PMP 2025 Aspirants

These formulas appear in EVM questions, forecasting, risk analysis, contracting, scheduling, and more. Mastering them makes the PMP exam easier—and real projects more predictable.

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In most organisations, project schedules are developed based on logical or technical dependencies in the network diagram. These schedules would assume unlimited resources. When the necessary labor, equipment, or skills are not available at the required time, the project becomes resource constrained. In such cases, the original schedule cannot be executed as planned, and resource leveling is required.

How Resource Leveling Resolves the Issue

Resource leveling is the process of adjusting the schedule so that the use of resources does not exceed predefined limits. It accomplishes this by delaying or rescheduling activities while still attempting to meet project objectives.

The Parallel Method

The Parallel method is one of the most widely used resource leveling techniques because it is systematic, logical, and easy to apply in software tools. It works by one schedule at the start of the day to analyze all the tasks for the day. Check the resources, if they are available, complete or start the task. If not prioritize main tasks. Tasks with lower priority get delayed, move tto the next day and repeat. This method will help manage resources.

General Impact on the Project Schedule

1. Schedule Extension

Tasks that cannot be staffed are delayed, which often increases the overall project duration. This is most common when resource constraints affect activities on or near the critical path.

2. Change to the Critical Path

The delay of previously non-critical taksmay reduce or eliminate float, creating new critical paths or extending the existing one.

3. Smoother Resource Usage

The main benefit is a more realistic schedule with resource usage spread more evenly over time. Peaks in demand are reduced, which lowers the risk of burnout, inefficiency, or underutilisation.

Relationship Between the Post-Leveling Schedule and the Rolled-Up (Baseline) Budget

Timing of Costs Changes

Even if total project cost does not change, when the money is spent, tasks pushed later shift their cost profiles to later periods, causing the overall cash-flow curve (S-curve) to shift to the right, and as a result, monthly or quarterly budget allocations may increase or decrease depending on how activities are redistributed after resource leveling.

Baseline Must Be Updated

The original baseline (scope–schedule–cost) becomes unrealistic if resource leveling significantly modifies the schedule. The post-leveling schedule becomes the new baseline that aligns activity timing, resource usage, and cost distribution.

Earned Value Implications

The Advanced Skills for Project Managers course is designed to provide you with the expertise to effectively plan, schedule, budget, and control complex projects. Learn advanced techniques like Earned Value Management (EVM), capital budgeting, and stakeholder engagement to elevate your project management capabilities.

Course Highlights:

✅ Master the art of project planning using the Statement of Work (SOW) and Work Breakdown Structure (WBS) ✅ Learn to schedule project activities and calculate variances using Earned Value (EV) techniques ✅ Select the right projects using capital budgeting techniques like NPV and IRR ✅ Gain powerful negotiation and communication skills to manage stakeholder expectations ✅ Utilize project management software for efficient project control and forecasting

🔗 Enroll Now: Advanced Skills for Project Managers